End of year finalisation with Single Touch Payroll reporting

This means an employee's pay history has been manually changed in their contact record. This might have occurred if you started using payroll part-way through the payroll year, and you've entered your employees' year-to-date payroll totals.

Otherwise, it means an employee's pay history has been manually updated in error – usually in an attempt to fix their pay amounts. Instead, you should only ever fix a pay by changing or deleting the pay.

Providing you have not processed the first pay for the new payroll year, you'll need to identify which employee this impacts, then fix their pay history.

Identify the affected employee

1. Compare the above two reports again, and find the employee whose totals on the reports don't match. For example, check the Salary and wages columns in both reports to see where the amounts differ for an employee. Then move to the Deductions column and so on.

2. Click the dropdown  arrow for that employee on both reports. This shows a breakdown of the amounts paid to the employee per pay item.

3. Identify the affected pay item. This will help you identify what has likely been changed in the employee's pay history.

4. You can then update the employee's pay history to undo whatever manual change has been made (Payroll menu > Employees > click to open the employee's contact record > Payroll details tab > Pay history tab).

5. Once you've fixed the employee's pay history, send an update event to the ATO (see the FAQs below for details).

6. Once the update event has been accepted by the ATO (check the report status to find out), run the above reports again to confirm the totals match.

1. Go to the Payroll menu and choose Single Touch Payroll reporting.

2. Click the the EOFY Finalisation tab.

3. Choose the Payroll year. The Gross Payments (YTD) and PAYG withholding (YTD) values are the total amounts sent to the ATO for all your employees.

4. Click View YTD verification report (PDF).

   

   The report displays as a PDF. Take note of the Total salary and wages as per payroll summary report. Here's an example:
   

What am I looking at?

• This report shows the total of all ATO reporting category amounts sent to the ATO for all employees.

• The Reconciliation to Payroll section is not sent to the ATO. It shows total gross wages which you'll also see in the Payroll Summary report in MYOB. This amount will differ from the total gross wages reported to the ATO, as it doesn’t include Allowances, CDEP, Foreign Income, ETP components (not ETP Tax), Lump Sum values or any additional reimbursable/employee expenses.

• The ATO Reporting Category section lists the things that have been submitted to the ATO.

• The Total payments (in the ATO Reporting Category section) doesn't include allowances. This amount should be the same as what's shown in your Payroll Summary report in MYOB, minus any allowances or the other pay components which are listed in the Reconciliation to Payroll section.

• An employee's reportable fringe benefit amounts are reported to the ATO when you finalise, so these won't display on the YTD verification report until after you've completed the finalisation.

1. In MYOB, go to the Reporting menu and choose Reports.

2. Click the Payroll tab.

3. Click the Payroll summary report.

4. Set the report filters to cover the entire payroll year (1 July to 30 June).

   

5. Take note of the YTD total for Salary and wages. The report is grouped by ATO reporting category, so the total salary and wages is at the bottom, as shown in this example:

   

After you've run the above reports, compare the YTD total wage amounts on both. If they match (like in our example), you're ready to finalise.

If the reports don't match

Here are some things to check.

Check your ATO reporting categories

Make sure you've assigned an ATO reporting category to each of your pay items.

1. Go to the Payroll menu and choose Pay items.

2. On the Wages and salary tab, look for any pay items which are To be assigned. Here's an example:

   

3. If any pay items are To be assigned:

   1. Click the pay item name to open it.

   2. Assign the applicable ATO reporting category. For help choosing the right one, see Assign ATO reporting categories for Single Touch Payroll reporting or speak to your accounting advisor.

   3. Click Save.

4. If you add or change the ATO reporting category in a pay item, send an update event to the ATO as described below.

Once all pay items are assigned an ATO reporting category, run the YTD verification and Payroll summary reports again (as we did above) to ensure they match. If they do, you're ready to finalise. Otherwise, continue below to check the reported wage values for individual employees. This will help you narrow down your out of balance.

Check reported wage values for individual employees

There are two reports you (or your accounting advisor) can use to check the amounts paid to individual employees for the payroll year.

• In MYOB, run the Payroll register report (Reporting menu > Reports > Payroll tab > Payroll register > click the dropdown arrow  for each employee).

• In the Single Touch Payroll reporting centre, click the ellipsis  button for an employee and choose View summary report (PDF). This report shows a summary of all ATO reporting category amounts sent to the ATO for an employee (gross payments, PAYG withholding, allowances, etc.).

 Here's what these reports show:

To ensure the latest year-to-date amounts are sent to the ATO for an employee, you can send an update event to the ATO as described in the FAQs below.

If you see a negative amount for an ATO reporting category on an employee's Summary of Payments report, this amount will be reported as zero to the ATO. To fix it, you'll need to reassign this value. We recommend seeking advice from your accounting advisor for help.

1. Go to the Payroll menu and choose Single Touch Payroll reporting.

2. Click the Employee terminations tab

3. For the terminated employee, enter or choose their Employee end date.

4. Click Notify the ATO.

5. When prompted to send your payroll information to the ATO, enter your details and click Send.

This declaration is processed in the same way other Single Touch Payroll reports are. They must be accepted by the ATO, which can take up to 72 hours.

1. Go to the Payroll menu and choose Single Touch Payroll reporting.

2. Click the Employee terminations tab.

3. Choose the applicable Payroll year and click Add Termination.

4. Choose the Employee who was terminated.

5. Choose the Termination date and Termination reason and click Notify the ATO.

   

6. When prompted to send your payroll information to the ATO, enter your details and click Send.

This declaration is processed in the same way other Single Touch Payroll reports are. They must have a status of Accepted in the payroll reporting centre before you can finalise your STP information.

Yes, you can record a pay in July before finalising - BUT FIRST make sure you've compared your payroll reports to identify and fix any discrepancies. Then, you can record a pay with a July Date of payment before finalising.

Because the July pay is dated in the new payroll year, it won't be included in the payroll year you're yet to finalise.

When you look at the EOFY finalisation tab or the YTD verification report in the STP reporting centre for the current or last payroll year, you might notice the values don't look right. This can happen if you've recently moved to STP Phase 2.

You can easily fix this by sending an update event. If needed you can do this for the current and previous payroll years.

1. In the STP reporting centre, click the STP reports tab.

2. Choose the Payroll year (for the year where the values don't look right).

3. Click Send update event.

4. When prompted to send your payroll information to the ATO, enter your details and click Send.

You can sync your payroll totals in MYOB with the figures held by the ATO. This is a quick way of ensuring the ATO has the current year to date payroll figures for your employees.

If you're reporting via STP Phase 2, you can send an update event from the STP reporting centre. Otherwise you'll need to record a zero dollar ($0) pay for each employee whose year to date payroll totals you want to send to the ATO.

Am I reporting via STP Phase 2?

You can check in the STP reporting centre (Payroll menu > Single Touch Payroll reporting). How do I get ready for STP Phase 2?

Sending an update event for STP Phase 2

1. From the Payroll menu, choose Single Touch Payroll reporting.

2. Click the STP reports tab.

3. Choose the applicable Payroll year.

4. Click Send update event.

   

5. When prompted, enter your details and click Send.

Update events are listed in the Single Touch Payroll reporting centre with your other payroll submissions, but with zero (0.00) amounts.

Sending an update event for STP Phase 1

You can send an update event for an employee by recording a $0 pay. This type of pay is also called a void pay and it's like any other pay, but all hours and amounts will be zero. When you record a $0 pay, the employee's latest year to date payroll totals will be sent to the ATO.

1. Start a new pay run (Create menu > Pay run).

2. Set the Pay cycle to Unscheduled.

3. Ensure the Date of payment is in the payroll year you're sending the update event for.

4. Select only the employees you want to send an update event for.

5. Because you set the pay cycle to Unscheduled, you'll notice all hours and amounts are removed from each employee's pay (which is just what we want). Here's an example.

   

6. Complete the pay run as you normally do and declare it to the ATO. Need a refresher?

Update events are listed in the Single Touch Payroll reporting centre with your other payroll submissions, but with zero (0.00) amounts.

If you process a pay in the new payroll year (e.g. 1 July or later) but the Date of payment is in the previous payroll year (e.g. 30 June or earlier), the ATO will treat the pay as an update event. Even if the pay contains amounts that you're reporting to the ATO, they'll consider it an update event (and not a pay event) because it's related to the previous payroll year.

But don't worry, even though the pay run shows as a $0 update event in the STP reporting centre, the updated year-to-date payroll totals (for last payroll year) for the employees in the pay run will still be reported to the ATO.

Each STP report sent to the ATO includes the employer pay period information and the employee year-to-date (YTD) amounts.

As the ATO doesn't allow you to delete these reports, the Business Portal will show every pay run declared through STP, including ones that you have deleted or reversed in your software.

So, in most cases, if you've made payroll adjustments the Business Portal may not match your STP reports. And that's OK. Just make sure you check year-to-date totals in MYOB before finalising.

The ATO does not receive the details of individual pay runs, only the year-to-date payroll amounts. So, provided you've submitted a pay after setting up STP, the latest year-to-date totals will be submitted. Still, we recommend you check your YTD amounts prior to finalising.

You can undo an individual employee's finalisation. When you do, the employee's income statement in myGov will no longer be Tax ready so they won't be able to pre-fill and lodge their tax return.

1. Go to the Payroll menu and choose Single Touch Payroll reporting.

2. Click the EOFY finalisation tab.

3. Choose the Payroll year.

4. Select the employee whose finalisation you want to undo.

5. Remove the finalisation. How you do this depends on what you see.

   1. If there's an ellipsis ( ) button next to the employee, click it and choose Remove finalisation.

   2. If there is no ellipsis button, select the employee and click Remove finalisation and notify the ATO.

6. When prompted to send your payroll information to the ATO, enter your details and click Send. The Final indicator tick is removed for the employee. If it's still there, click a different tab then return to the EOFY finalisation tab.

7. When you're ready, you can finalise the employee again.

You can set up a report pack containing key EOPY reports. Once you've set it up, you can generate all your EOPY reports at once – with just a few clicks. And you can re-use the report pack to generate the same group of reports each year.

Start by creating a report pack template. You only need to do this once to select the reports to include in the template. Here are the reports to include, as they appear when creating the template:

• Payroll summary

• Payroll register summary

• Payroll register detail

• Accrual by fund summary

• Accrual by fund (detail) summary

• Superannuation payments detail

• Superannuation payments summary

• Leave balance (detail) summary

• Leave balance (detail) detail

Then, at the end of each payroll year:

• Create a report pack using the template you've created. This is where you set the date range for the reports, which will be 1 July to 30 June for the payroll year you're reporting on.

• Download the report pack to create a PDF containing each of the EOPY reports.

Learn all about report packs.